how to display categories?

You’ll have to use a plugin or edit the codes. You can also add CSS styles to each

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@ulgaming Can you provide any link for css styles?

<li class="cat-item cat-item-1"><a href="LINK" title="Title">Title</a></li>

The answer is in the question. Style the class in your css.

Google to learn about CSS and how to use it — or find a site that already does what you like and look at how they did it in their CSS.

Can you link me to any tutorials?
Thanks

There is another thread from someone who wants to do exactly the same thing in the forum just now.

That should help you get the generated code you need. As for learning CSS, there are thousands and thousands of sites dedicated to that out there. Smashing Magazine, CSSTricks, NetTuts/ThemeForest, SitePoint, W3Schools, etc. etc. etc.